BY CARLOS MEDLEY
fter a powerful opeing session highlighting mission as the main concern, the business of the 2001 North American Division (NAD) Year-end meeting was driven by the "R" words--retirement and renumeration.
More than 250 Adventist pastors, administrators, educators, and lay members gathered in Silver Spring, Maryland, on October 28-31 for the NAD Executive Committee's annual year-end business session. In this meeting committee members hear reports, vote policies and guidelines, and approve the division's operating budget for 2002. However, this year's NAD Committee sought to address many thorny questions about how the Adventist Church is caring for its retired workers. The committee also studied a proposed salary scale for pastors, K-12 educators, administrators, and departmental personnel.
Regional Retirement
For nearly three hours on Tuesday morning (October 30), the executive committee discussed a proposed agreement between NAD and its nine predominantly African-American (or regional) conferences regarding those conferences' newly-established retirement plan launched earlier this year.
The regional retirement plan was announced at the 2000 year-end meeting. Regional conference leaders turned thumbs down on the division's new defined contribution plan that started January 1, 2000, because they felt the church's plan shifted the responsibility of investment to employees.
They also felt that African American workers under the NAD plan could not accumulate the needed money to provide an adequate retirement.
The regional plan provides full retirement benefits for employees with 30 years of service, while the NAD plan requires 40 years of service.
The document presented to committee members outlined funding and procedural protocols to care for active employees and retirees with regional conference service credit. Under the voted agreement, regional conferences will pay $39.4 million to the North American Division to cover the approximately 500 employees who've retired before 2000 with service credit from regional conferences. (There are about 15,000 total NAD retirees.)
The regional plan assumes the full retirement liability for all current regional conference employees, regardless of years of service.
The arrangement also calls for NAD to pay $6 million to the new regional retirement plan. This money will first go into an escrow account until all prerequisite conditions are met satisfactorily. Ultimately, the $6 million will become part of the regional retirement fund. To acquire the $6 million, the committee voted to request that NAD officials obtain a loan from the General Conference that is expected to be paid off within 18 months.
In assessing the impact on the NAD program, retirement fund administrator Del Johnson said the agreement was necessary because it reduced NAD's liability (for funding regional conference employees) and brought a $39.4 million funding commitment from the regional conferences.
"Without this commitment the NAD retirement plan would most likely default in the year 2011," Johnson said in an interview. "Now our actuarial funding will decrease from 14 percent today to 8 percent in 2011."
The reason for the decrease is because many employees are expected to retire within the next 10 years. After 2011, the actuarial funding level will increase. Currently the church=s retirement fund totals about $308 million, a little more than three years of reserves.
While the agreement passed by 156-78 on a secret ballot vote, a margin of 2-1, many committee members still voiced their displeasure that the church would maintain two separate retirement plans covering NAD ministers and educators.
Clarence Kegler, a lay member from Spartanburg, South Carolina, said. "I'm concerned about the administrative cost of two plans. Was there an attempt to develop a plan that serves both [NAD and the regional conferences]?" NAD president Don Schneider responded that the regional conference plan would not be administered by NAD, but by a separate board.
Responding to concerns that the plan divided the church, South Central Conference president Joseph McCoy explained, "Just because we have different conferences doesn't mean we're divided. When the Southern Union meets, I'm there. When the North American Division meets, I'm here. When the General Conference meets, we send representation. I hope in our quest to try to solve injustices from the past we do not try to do it by preventing this measure from going forward. You can vote it down if you'd like. But when I go back to my conference I have to deal with the reality that there are retirees who do not have enough to live on."
North Pacific Union president Jerry Patzer also urged the committee to take another look at NAD's defined contribution retirement plan, saying the church was going in the wrong direction here. "We=ve evolved in a negative way with this retirement plan over the years," Patzer said. "We're going to have take a realistic look at this. But as much as I don't like looking at another plan today, it is forcing us to take another look at this retirement plan again with the non-regional conferences. I'm hoping we can come up with a plan that's good enough so that some time down the road the regional conferences can say, "I can buy that," and join with us."
Lake Region Conference president Norman Miles spoke encouragement to the group. "I do not share the pessimism of some of the speakers regarding the church," Mile said. "As a result of my involvement in the negotiations that brought about this document, I'm more encouraged about the future of the church. We think we=ve done a favor for the entire church because now everyone is looking at this issue."
After the secret ballot vote passing the agreement, the committee also voted to raise the contributions on NAD's defined contribution plan. The annual employer's contribution and employee match was raised from 7 percent to 8.75 percent of the employee's salary. Schneider said the action would bring the two plans a bit closer together. He also said that the union presidents would restudy the NAD defined contribution plan next year.
Remuneration
For years one of the most pressing issues facing NAD administrators was the issue of salaries for pastors and educators. Some local conference officials voiced concern because ministerial salaries have often not kept up with the cost of living. Some church organizations have even departed from the denominational wage scale.
Others leaders say low pastoral wages have made it more difficult to attract the most promising students into ministry. Education administrators are also concerned because the most experienced faculty members on Adventist campuses will be retiring in the next 12 years, and they believe the brain drain will be difficult to plug.
For nearly three years the NAD Remuneration Taskforce has been meeting to restudy the Seventh-day Adventist philosophy of remuneration and the denominational salary scales for pastors and educators. One year ago the committee was restructured to include a majority of lay members.
Taskforce chair George Crumley, a retired NAD treasurer, presented 15 recommendations to the committee. Of those recommendations, six were voted; the others will be referred to the appropriate committees for further study. It is expected that the referred recommendations will be brought back to the 2002 year-end meeting for approval, with implementation in 2003.
Of the recommendations voted, the most significant change involves the basic wage percentages on which ministerial and education salaries are paid. For example, ordained ministers, teachers, and academy principals are paid at 150 percent of the NAD monthly wage factor of $2,240.* Officers and departmental personnel of local conferences, unions, and the division, are paid at slightly higher percentages. Under the new plan the basic salary percent for ordained ministers would be set at 100 percent, with a monthly wage factor of $3,360.
The committee also voted to expand the pastors' wage rate so that ministers who pastor churches with large membership, or who supervise a pastoral staff, would be paid up to a cap of 109 percent. The maximum wage percentage factor for the division president would also increase by nearly 9 percent.
Crumley said taskforce members felt the scale had to be expanded, or "decompressed," in order to reward pastors and administrators who shouldered large responsibilities.
The committee approved a change in the current remuneration policy for cost-of-living increases. Heretofore, the standard policy for cost-of-living increases was the annual increase of the Consumer Price Index (CPI) or gross tithe, whichever was lower. The new measure identifies the CPI as the sole guideline for wage increases. Crumley explained, "The taskforce felt it was important to keep up with cost of living increases so that worker salaries didn't get behind."
The committee voted another recommendation calling for the salaries of denominational employees other than those regulated by the NAD renumeration wage scale to be reported annually to their governing bodies. Schneider noted that in some cases, salary information of chief executives has been withheld from board members of institutions.
On Wednesday morning, concern was expressed about the increasing salaries of some Adventist colleges presidents. After a 30-minute discussion, the group voted a consensus resolution authored by Central California Conference president Jerry Page. The measure asks NAD to urge the boards of Adventist colleges and universities in North America to cap all renumeration at the level of the General Conference president.
Schneider explained that the resolution statement would only be used as a discussion starter, with a future study group reviewing salary levels in Adventist higher education.
*This is the lowest of five cost-of-living wage categories used to pay pastors and teachers in North America.
_________________________
Carlos Medley, news and online editor, Adventist Review.
More Religious News
Adventist News Network
Religion News Service
Religion Today
Exclude PDF Files